ATIA marketing bill in trouble

ATIA marketing bill in trouble

Republican lawmakers who support the governor's move to cut cruise industry taxes said Monday the idea is attached to the wrong piece of legislation.

The bill to fund the state's tourism marketing arm through industry tax credits is "dead on arrival," Rep. John Harris, R-Valdez, said Monday.

It's one of the first indications the legislation is in trouble, he said.

The bills, Senate Bill 138 and House Bill 167, aim to double the Alaska Travel Industry Association's budget for marketing Alaska as a tourist destination.

Gov. Sean Parnell on Friday announced support for a 25 percent cruise passenger head tax reduction, and proposed attaching the tax-cutting legislation to the ATIA bills.

The bills have stalled, along with others, in the finance committees of both houses.

Harris was a co-sponsor but changed his mind because the legislation removes the Legislature's power to appropriate the money.

"The money automatically goes right to them rather than through us," he said.

Juneau Republican Cathy Muñoz, a co-sponsor in the House, said there's still support among lawmakers to fund tourism marketing, but not through tax credits.

"On the finance committees, there's concern about the tax credit approach because there's so many tax credit proposals on the table right now," she said. "I think the governor would be wise to have stand-alone legislation or committee legislation."

Several Democratic lawmakers contacted Monday for comment did not return phone calls by press deadline.

Parnell's proposal announced Friday would lower the $46 per-passenger head tax by $11.50. In exchange, the industry would drop its lawsuit over the tax and move more ships to the state.

ATIA President Ron Peck said it makes sense to address the issues together.

"If they support reducing the head tax, I would hope they would be supportive of both pieces," he said. "This governor believes that tourism funding and a head tax are important, so that's good news."

At a meeting with the press Monday morning at the Capitol, House Speaker Mike Chenault, R-Nikiski, and Rules Chair Nancy Dahlstrom, R-Anchorage, expressed the same concerns as Harris about tax credits removing the Legislature's appropriation authority.

Chenault said the two tax issues should not be tied together even though they are both related to tourism.

Citing a drop of 85,000 in tourist visitors last year and an expected 140,000 drop in cruise passengers this summer, Peck said Alaska's tourism industry is in trouble.

Alaska spends $11.7 million a year marketing itself as a tourist destination, but the figure should at least double to begin to compete with states such as Hawaii, which spends more than $70 million, Peck said.